This is something Google began doing a while back - adjusting the clickable text according to the actual search terms that were entered. It's done by algorithm, and the intention is to increase clicks to the website, especially in situations where the exact search terms do not appear in the page's title element.
The question is being asked quite frequently as Google is getting more aggressive about the title rewrites, and I just posted the above link in another current thread.
Also, take a look at the Hot Topics [webmasterworld.com] section, pinned to the top of the Google SEO forum home page, and in "THE SERPs ARE EVOLVING" section you'll find one of the early discussions on the question. In that thread the question of effect on rankings was brought up. IMO, no... the title change doesn't affect your rankings. Google is simply trying to help with click throughs.
I notice it most in local search, the world I live in.
In the local organic listings, she leaves the title tag but sometimes re-writes it.
However in the local blended results she totally strips out the title tag (except for the A listing) and instead tries to scrape what she 'thinks' is the business name from the site. But sometimes she gets it wrong and instead puts something bogus in the title like "subscribe here" or "Call Nancy for an appointment". Or other things that def don't help with click-through. :-(
But as Robert said, it does not appear to affect ranking. So she's still reading and ranking based on title tag, just displaying something different.
It frustrates me that Google presumes it knows better than me what the page title is on my site... but more than that they are now "competing" in local search, so what motivation is there for them to change the page title in a way that benefits me? None. What motivation is there for them to change it in a way that makes users less likely to click through to my page and wander off to the Google+ Local pages... plenty.
Just another way Google stacks the cards in their own favour. Same old, same old.